Who regulates prediction markets in the US?
Federal regulators, states and the courts all have a stake. Here is where things stand.
ExplainerThe federal view
Exchanges such as Kalshi are designated contract markets regulated by the Commodity Futures Trading Commission (CFTC). In October 2026 the CFTC proposed adding event contracts to the legal definition of a swap, which would place them under its exclusive oversight.
The state view
Many states argue that sports event contracts fall under their own laws. More than 40 states and DC have made that case to the CFTC, and several states, including Utah, Arizona and Michigan, have taken action against platforms.
The courts
Federal appeals courts are split. The Third Circuit sided with Kalshi in April 2026. The Ninth Circuit in August and the Sixth Circuit in September reached the opposite view. New Jersey has asked the Supreme Court to decide.
What it means
The rules are still being settled. Platforms, states and the CFTC are all in court, and many expect the Supreme Court to have the final word.
